Insiders Just Bought $62.1 Million Worth Of Tesaro (TSRO) Shares. Time To Buy?

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A number of TESARO Inc (Nasdaq: TSRO) insiders has bought 1.1 million shares since Friday. While the stock has lost more than half its value in six months, it’s worth taking a closer look at the company.

Insider Buying: Tesaro

Insiders have been buying shares of Tesaro according to recent form 4 filings with the SEC. The notable insiders include Leon Moulder (Co-founder and CEO) as well as a number of general partners of New Enterprise Associates (10% owner), as shown in the table below. Total insider buying has totaled $62.1 million since last Friday which is approximately 1.8% of Tesaro’s total market capitalization.

Recent TESARO, Inc. Insider Transactions

Insider Trading

Relationship

Date

#Shares

Value ($)

BARRETT M JAMES

10% Owner

Mar 2-6

116,445

$6,684,477

BARRIS PETER J

10% Owner

Mar 2-6

145,532

$8,354,185

BASKETT FOREST

10% Owner

Mar 2-6

145,532

$8,354,185

KERINS PATRICK J

10% Owner

Mar 2-6

116,445

$6,684,477

MOTT DAVID M

Director

Mar 2-6

145,532

$8,354,185

MOULDER LEON

Co-Founder and CEO

Mar 02

5,000

$284,640

NEW ENTERPRISE ASSOCIATES 13 L

10% Owner

Mar 2-6

116,445

$6,684,477

SANDELL SCOTT D

10% Owner

Mar 2-6

145,532

$8,354,185

Viswanathan Ravi

10% Owner

Mar 2-6

145,532

$8,354,185

TOTAL

1,081,995

$62,108,996

Peter Barris, who is the Managing General Partner at New Enterprise Associates, most recently bought $8.4 million worth of shares on March 6th. This is what propelled me to take a closer look at the company’s insider activity.

Potential Reasons For Insider Activity

Tesaro is an oncology-focused biopharmaceutical company that identifies, acquires, develops, and commercializes cancer therapeutics and oncology supportive care products in the United States.

The company’s shares last traded at $62.18 as of Wednesday, down -64.9% over the last year and 26.8% in the last three months. While the stock has lost significant value, the recent insider transactions could signal a bottom has been reached.

source: finbox.io

In addition, finbox.io’s average fair value estimate of $74.47 implies 19.8% upside and is calculated from 4 valuation models as shown in the table below. Each analysis uses consensus Wall Street estimates for the projections when available.

How Should You Interpret this?

While executives and insiders are always happy to tell you all the reasons why their stock is a buy, their actions can tell a different story about the company’s future prospects. A trend of buying activity may indicate that insiders think the stock is going up over the upcoming time period, and are trying to buy before the price rises.

Keep in mind that insider activity is only one aspect of stock research and that there are other important items to consider. I recommend you continue to research Tesaro to get a more comprehensive view of the company’s fundamentals by looking at:

Valuation: how much upside do shares of Tesaro have based on Wall Street’s consensus price target? Take a look at our analyst upside data explorer that compares the company’s upside relative to its peers.

Risk Metric: what is Tesaro’s Altman Z score? It’s a famous formula used to predict the probability that a firm will go into bankruptcy within two years. View the company’s Altman Z score here.

Author: Brian Dentino

Expertise: financial technology, analyzing market trends

Brian is a founder at finbox.io, where he’s focused on building tools that make it faster and easier for investors to research stock fundamentals. Brian’s background is in physics & computer science and previously worked as a software engineer at GE Healthcare. He enjoys applying his expertise in technology to help find market trends that impact investors.

Brian can be reached at brian@finbox.io.

As of this writing, Brian did not hold a position in any of the aforementioned securities and this is not a buy or sell recommendation on any security mentioned.